ECONOMIC CRISIS IN GREECE. EUROPEAN AND DOMESTIC MARKET AND POLICY FAILURES

This paper provides a detailed account of the drivers behind the economic crisis in Greece, which has destroyed one quarter of the GDP of the economy and has led more than a quarter of labour force to unemployment in a period of five years. The paper claims that a mix of background factors at the European and the national level and the policy reaction to the crisis jointly reinforced a negative spiral that after some point accelerated and had snow-ball effects for the Greek economy. At the European level the background factor is the unbalanced European economic architecture, while at the national level the background factors include the structural weaknesses of the economy and the operation of the political system and the public sector. These factors, along with a number of serious policy deficits and the mismanagement of the crisis at the European and domestic level have transformed quickly Greece from a celebrated success story to a disappointing failure and the EU economy for a first time to an unsecure landscape with many slippery spaces in its periphery.